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The Kindle Index

priceonomics.com

78 pointsomarish69 comments

Unless I'm totally mis-understanding their data gathering, this post seems completely wrongheaded (or at the least, willfully ignorant and self-serving.)

They're indexing the popularity of e-readers in different MSAs by looking at how many are for sale on secondary markets, as a % of what's for sale on the secondary markets in that city. This seems like a really poor proxy for how popular e-readers are in those locations.

There are several things they're not correcting for:

* The more someone uses their e-reader, the less likely it is to end up on a secondary market - either because you're using it, or you still intend to use it, or you broke it. (This is what happened to my last Kindle - I used it heavily, but eventually something in my bag rammed into the screen and broke it to a point it was unsaleable.)

* Some cities may have a larger volume of items per-capita on a secondary market because people have more to sell. E.g. if you have a larger house with a garage, you probably have more items to potentially resell than someone with a tiny apartment.

* Cities with a lower proportion of smartphone / tablet users might buy more kindles. That doesn't mean they're consuming fewer ebooks.

I agree with you. In addition, compared to the price of living in a city like New York or LA, a Kindle is quite cheap and almost disposable. It makes sense to me that less New Yorkers would be trying to sell their old Kindles.

I didn't think about this before but yeah, with the price of a _new_ Kindle at about $80, a used, unwarrantied one from the prior generation must run as low as $30-40. At that level you're starting to get too low for most people to bother selling it on CL.

Agreed -- correlating the amount of Kindles resold on Craigslist to a population's "e-literacy" seems tenuous at best. There's a buncha variables in play when you're considering the types of people who 1) are on the Internet, 2) are using Craigslist to resell, and 3) have Kindles to resell.

If anything, I'd observe from the data that college towns resell their Kindles a lot more because the students are receptive to new/hip tech, collect their data point, and plenty of them move on by reselling via Craigslist, which extracts more value over eBay/Amazon, with some opportunity cost of time (to fulfill the order by meeting in person and what not).

Absolutely!

The Kindle is a wonderful device that is already very good and doesn't improve enough to justify upgrading all the time like Apple devices. And it's very cheap, which makes selling old ones not very appealing.

I own a Kindle 3 (with a keyboard) and couldn't live without it. Even if I eventually buy a newer one I will keep that one to leave at home for example, or give to my kids. But sell it? Never.

This post is quite disappointing, as are most from Priceonomics. They are apparently trying to mimic the blogging strategy of OKCupid, but they're doing it very poorly.

Off topic question, but you seem like a long time Kindle user, did you ever have screen problems with it? Mine is just two months old, and its screen half-froze and I can only read half of the documents. I googled this around and it looks like its a frequent hardware problem people face.

Just call Amazon - I broke mine by dropping it (completely my fault) and they replaced it within a week.

Will do. Though I have two issues. One is that I bought it from Staples, not Amazon, and I am not sure what they would do in this case. Second, though I bought it in the US, I am currently in Sao Paulo. I hope they can send it overseas.

Never had a problem with mine, and I don't treat it with special care. YMMV, I guess... ;-)

And they add to the abuse of Confucius apocryphal quotes. (Confucius was talking about studying, hardly equivalent to reading Da Vinci Code...)

While working as a former economic researcher, my then-boss had a litmus test for analyzing studies: he would always try to identify an alternative explanation for any qualitative assertions made by the study. See midas's comment below for a great example of this. [0]

In economics -- hell, in any empirical field -- it's absurdly hard to draw qualitative conclusions. If you see these often, like in Priceonomics's blog posts, then you should have doubts.

I get Priceonomics is a YC company so we should cheer for them or something, but they're quickly picking up a reputation for making qualitative jumps using elementary work. You don't want to be in that position when you're in the business of analyzing data.

[0] http://news.ycombinator.org/item?id=3859136

This is the first of their posts that seems like BS intended to go viral. Previous ones have been fairly interesting even if a few basic economic principles have been willfully avoided to make them more juicy.

You must live in fresno :(

My understanding was that Amazon kept their Kindle sales closely guarded. The type of person that purchases a Kindle off of craigslist must be completely different than one that buys it off Amazon.

I might be wrong, but Amazon already sells cheaper refurbished Kindles where as Apple does not do the same for iPads.

where as Apple does not do the same for iPads.

They do: http://store.apple.com/us/browse/home/specialdeals/ipad

Not to mention that the big price drops for e-readers were just this Christmas season. I personally bought two $89 Kindles as gifts for relatives, and I'm sure tons of others were sold at that price, and they wouldn't be reflected in these stats at all.

I wonder if the reason that there are so few e-readers for sale is because their use-case doesn't really change. In other words, they remain useful for much longer.

This might make people hold onto them instead of constantly upgrading to the latest version.

Definitely agree with you.

I've had an older Kindle for a while now. It's an uncanny relationship. With most of my electronic devices, I can tell you the exact specs, when I got it, and how antiquated it is. My Kindle is different; it feels like a book to me, not a complex device.

Brilliant work on Amazon's part.

Brilliant for you, yes. But when does amazon begin to consider this a bug, not a feature? I worry for the day that some new feature is introduced in .azw files that will break legacy devices. Now that would be evil.

Amazon are looking to make money off the books, not the device (they're basically the opposite of Apple). The Kindle device price is trending towards zero - a lot of good money is betting that Amazon will eventually give it away for free, making all their money back on book purchases.

In my case that is 100% correct. I've got the Sony PRS-650. It isn't wireless, doesn't have a built in light, simple functions (read a book). But there is no reason for me to upgrade to anything that has more features.

I plug it in when I want to put a bunch of books on it, I have a light in the case, I only want to read books. No reason for me to upgrade.

I'll upgrade when it breaks or another family member wants one.

Good point. Why would there be so much churn for a few bells and whistles bezeled around an e-ink display.

That said, that new Nook Simple Touch with the "backlight" could be a gamechanger, at least for me.

Agreed - I've been waiting for a built in light since the first time I saw a Kindle. Although making it this easy to read in bed probably means I'll get even less sleep :)

I think part of the explanation would be that the underlying eInk displays have not evolved very much either, and thus the devices themselves have limited potential to grow.

Plus, I'm more likely to just hand over my old Kindle to a family member or friend than try to get money out of it. An old iPad might be worth a few hundred bucks - an old Kindle? It doesn't seem like it'd be worth the effort to put on Craigslist.

Something else to consider is how fast and how steep the price drops on a Kindle have been. From Wikipedia: "On July 8, 2009, Amazon reduced price of the Kindle 2 from the original $359 to $299. On October 7, 2009, Amazon further reduced the price of the Kindle 2 to $259. On June 21, 2010, hours after Barnes & Noble lowered the price of its Nook, Amazon lowered the price of the Kindle 2 to $189." Now it's down to $99 for the ad version.

So, is someone who paid $250+ for a Kindle just two years ago really going to sell it for $50 or so, when the new models aren't much different?

>Kindles and Nooks aren’t really competing against each other so much as both of them are holding on for dear life versus the iPad

...except that Kindles and Nooks aren't trying to compete with the iPad, being completely different types of devices for completely different primary purposes.

Maybe some Kindles and Nooks, but the Kindle Fire is certainly not a completely different type of device.

right, but the Kindle Fire competes with the iPad like a Honda competes with a Mercedes. Sure, they "compete" but most likely someone that buys one won't buy the other.

Even then I find it difficult to compare a $200 7" tablet with a purposely limited app store to a $500 10" tablet with the largest app store around. There are similarities, but I think it's closer to how Toyota doesn't really compete with BMW.

Los Angeles is an Apple town. Much higher proportional use of Apple products than other cities. iPads are status markers here. I suspect San Francisco is the same.

While they may not compete directly, if people already have iPads for other reasons, it seems they'd be less likely to buy a kindle.

Here's an interesting dimension to look at: prevalence of e-readers (and iPads etc) vs mass transit use. My train to work in the morning is stuffed with people using various hand-held non-phone devices; I can't imagine they'd be as popular with car commuters :)

Another (silly) one: e-readers vs holidays taken in hot places. Maybe people don't buy e-readers in California because they're already somewhere sunny, so they don't take beach holidays? ;)

Would be better with some more data.

Ex: Overall literacy rates: https://en.wikipedia.org/wiki/Literacy_in_the_United_States

"In 2011, the National Institute for Literacy estimated that 47 percent of adults in Detroit, Michigan are "functionally illiterate," meaning they have trouble with reading, speaking, writing and computational skills."

So Detroit is not likely to be a hotspot for ereader sales.

Also data from Amazon: (books, magazines and newspapers purchased per capita)

1. Cambridge, Mass.

2. Alexandria, Va.

3. Berkeley, Calif.

4. Ann Arbor, Mich.

5. Boulder, Colo.

6. Miami

7. Salt Lake City

8. Gainesville, Fla.

9. Seattle

10. Arlington, Va.

11. Knoxville, Tenn.

12. Orlando, Fla.

13. Pittsburgh

14. Washington, D.C.

15. Bellevue, Wash.

16. Columbia, S.C.

17. St. Louis, Mo.

18. Cincinnati

19. Portland, Ore.

20. Atlanta

source: http://phx.corporate-ir.net/phoenix.zhtml?c=176060&p=iro...

I can't help but wonder if the prevalence of Kindles in a particular city relates to the number of brick and mortar bookstores in that city. I am imagining that the more "cosmopolitan" cities probably have more physical bookstores.

I have another suspicion about the validity of the metric. Maybe people in bigger metros just buy more "stuff". For example you can't buy a subway ticket in Ann Arbor.

Exactly what I was thinking. People who love to read can get cheap, physical books everywhere in cities, and often from appealing local stores. I remember walking past quite a few cool bookstores in Seattle when I visited, and I know Denver has an awesome one. My college town had several.

The city I'm working in now doesnt even have a B&N so I am finding new love for my Kindle.

Right. If I still lived in Portland, Oregon, or even Eugene, I'd probably spend lots of time at Powell's or Smith Family and load up on real books. As it is, the selection of English language books here in Padova is fairly limited, and the other option, ordering from Amazon.co.uk is kind of slow too (despite reading, writing and speaking the language fluently, I don't enjoy reading in Italian as much as English for whatever reason, especially when the original is in English).

In that light, a device that lets me read books instantly is something of a minor miracle, and one of the best gadgets I have ever purchased.

Interesting. Since I believe the underlying data for market share is for US re-sales of the hardware I would be interested in how adding international data would fare. Kobo is a Canadian company as is rumored to have a significant share of the international e-reader market.

I'm also curious if, since the stats are based on devices being for re-sale if the cities near the top have batter local economies and more people are selling old devices to upgrade to newer ones where in an area with more economic uncertainty folks might be holding on to their current electronics longer and not upgrading as often.

In the interest of full disclosure, we have three Kobo e-readers in the family (Borders liquidation sale $50 each).

Go Ann Arbor! Ironic, considering that was the former headquarters of Borders.

As best I can tell, this article looks at resale data on e-readers and attempts to extrapolate that to use of e-readers. I doubt this extrapolation is appropriate. If, for instance, e-reader use was a constant proportion in all the cities, and the proportion of users who resell their e-reader was a constant proportion, but the proportion of users who resell their TVs was higher in the non "cultured" cities, using the authors' logic you would incorrectly reach the conclusion that the non "cultured" cities have greater e-reader adoption.

I just think it's a bit bizarre to use sales of dedicated reading technology as a proxy for books read. As has been pointed out here, there's a lot of not-so-dedicated tech that can read e-books. Plus, you know, there are books. Major metro areas still support great independent book stores. Places out in the hinterlands don't, which means that downloadability is a bigger factor.

Anyway, seems to me that if we really cared about literacy, we'd want a random sample of peeps asked how many books they read last month, not what hardware/software they have on which books might potentially be read!

I'd be curious to see the data if iPads were consider e-Readers. Then also to see it if iPhones were also added.

I own a kindle, but rarely use it b/c between my iPad and iPhone (with the respective kindle apps and other e-Reader apps) there is rarely a reason to carry along the Kindle.

One exception might be if I were going on a long trek in the wildnerness where the extra battery life of e-ink and the kindle offered a significant advantage (along with an absence of network connectivity which would diminis the advantages of the IOS devices).

I don't understand that. You can't use an iPad to read where there is lots of light, so how do you not find the Kindle much more useful? Anywhere where there's sunlight the Kindle has no substitute...

I rarely read outdoors, I guess. In any indoor lighting environment I've tried, the iPad works well.

I will probably buy a new kindle one of these days to try out the latest. My current one is the first generation device which is a bit less ergonomic.

What annoyed me the most in this post is not the lame analysis, it is the assumption that all readers are US citizens. No printable words can describe this.

iOS and Android have a Kindle app, which means every iPhone, iPad, and Android device can also be a Kindle. This fact is conspicuously missing in the analysis.

They can be, just like a computer can be. Ever tried reading on one of those for >30 minutes? Awful.

The last four or five books I've read were in iBooks on my iPhone. I can't imagine that the Kindle App for iOS is a dramatically worse experience.

The last seventy or so books that I read on my iPad, from novels to textbooks, weren't too bad.

I've never had a problem reading text on my blackberry, or even books on my iPad - but since I got a Kindle I do far, far prefer it to the iPad.

Maybe that's largely a personal opinion or maybe most people would agree with me, but either way my point is - yeah, it's not "too bad", and is perfectly fine, but it doesn't mean it's not significantly worse.

YMMV, but I found reading books on my transformer a lot more comfortable after I switched the kindle app over to white-on-black rather than black-on-white. It was enough that I almost gave up on my actual kindle for a while.

All this pre-retina? I find pre-retina text display blurry to the point of distraction after long periods of reading. Also, how do you hold your iPad? I like the newest and cheapest Kindle's size and weight for holding it an almost any position for long periods of time.

OK, I guess we should just completely ignore them because you don't like reading on lit screens. Makes sense.

The last 2 books I've read (the hunger games ones) were all bought and read on my 2 android devices (Galaxy Nexus and SIMless HTC Nexus). Cross-sync is awesome. I read on planes and before sleeping (you can invert the colors to have black background) The worst part is that I have an actual Kindle (albeit old)... somewhere. I don't miss it. At all. I love reading the kindle app on the phone anywhere, even buying the next one on the spot.

I have 2 Kindles, an iPhone and an iPad (latest generation) and I use the kindle app on them all. There's no issue with the iPhone and iPad - indeed there are times when I prefer them. The Kindle is also much better (at times) than using the iPad

I've read for hours on end on everything from a Palm IIIxe(Back-lit 160x160 grey-scale) and Palm T|X(320x480 color LCD) to a Kobo(e-Ink) and an iPad2. I've had no problems with any of them.

There's also a NOOK app for iPhone, iPad, Android, Windows, and Mac.

Ah, I did not know that.

But anyway, just to clarify, I mention that these apps exist because it could completely throw off the numbers as to how many "Kindles" (or "Nooks") there are in a given city. What if SF has tons of people reading Kindle books on their iPads? These devices can't be considered pure competitors to the Kindle (or the Nook), and their numbers are way, way too big to simply disgregard.

There's also a Kobo app for iOS, Android, Windows, Mac, and I believe there may be a Linux beta floating around, or maybe not.

I had a Kindle once. Lost it in a breakup. I still read more books in the Kindle app than dead tree books, and I don't miss not having a Kindle. Thanks to the Kindle app on my iPhone, reading serves as the mortar of my life, filling up all the cracks. I only used my actual Kindle at home for sit-down reading.

Interesting, the trend in calling regular books "dead tree books" and in leaving out the "e" in e-books. I have my own ideas as to why this is happening though I fear they would derail the conversation on the article at hand, thus I'll just leave it as food for thought.

I think it just means that the concept of book has separated from it's transfer medium. So "book" refers more to the content than the physical (or digital) representation. Compare to movie vs dvd.

There's ample precedent for this, as newer improvements become the norm. You won't often hear someone saying "color TV" or "unleaded gasoline" or "touch-tone phone" anymore. They became the standard, and we began to use modifiers to describe the older, rarer products.

I agree "dead tree" is a little bit derogatory, and unjustifiably so. Until e-books are strictly superior, until they are as good as physical books in every important way, we should respect what we've got.

I think my primary motivation for putting down dead tree books is that the e-books I've bought and haven't read are invisible. They don't sit on my bookshelves openly shaming me for not reading them :-O

I really like being surrounded by books I haven't read. Books I've read - I put them aside. Put some around and think of it as of an invitation.

In Lem's Solaris they have paper books even on space station. (Love Tarkovsky's movie.)

I read books constantly, and I do own a 2nd generation Kindle, but I think it is buried in a box somewhere from a move I did last fall. I do 99% of my reading these days on either my Android phone, my laptop or my desktop PC. I really think the killer feature that Amazon bring to its Kindle brand is actually "Whisper Sync" more than eInk displays or any other specific device. Being able to pick up my book from where I left off on any internet enabled device is the #1 reason my books purchases are almost exclusively from amazon.

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